[Asset Onboarding Application] - $USDC-SPL - USD Coin

Interested Party Profile

  • Name of the party submitting application: Marco Schobert
  • Contact (forum / twitter / email): marco@jetprotocol.io
  • Submission Date: 15-Apr-2022
  • If endorsed by Jet Community Member, list here: Member of Jet core team.

Application Profile

1. What is your motivation for submitting this application?
The purpose of this application is to provide Jet Community with details that led to Jet approving USDC as one of its first asset types.

2. What is your association to the proposed collateral?
No association.

3. What are the benefits to the Jet Protocol for onboarding?
USDC is a dominate, institutional focused stable coin that provides liquidity as well as stability to the defi market. USDC-SPL is a native Solana asset, backed by fiat-collateral, consistently audited, and supported by Centre - a consortium of crypto leaders.

4. Known limitations of the collateral type:
USDC is a widely accepted stable coin, accessible to any wallet holder to freely use within DeFi. USDC does however have large barriers to entry (large USD deposit requirements and KYC) in order to utilize its minting and redeem features with fiat. Because of that, the use of those features tends to be reserved for institutional players.

Project Profile

1. Please provide a brief, high-level description of the asset’s native ecosystem (project), including protocol’s type (peer-to-peer/ peer-to-liquidity/ etc.).
USDC-SPL is the product of CENTRE - a joint venture between CoinBase Inc and Circle LTD, created with the aim of being the digital currency of use for CENTRE’s peer-to-peer payment system. USDC-SPL has followed after the rapid and successful adoption of USDC-ERC20 on the Ethereum blockchain under CENTRE’s multi-chain initiative. CENTRE operates as a pool-to-lending model, which allows users to mint USDC against fiat-collateral, and redeem USDC for fiat.

2. Who are the founding members? What is their current involvement with the project?
CENTRE is a consortium established jointly by Circle and CoinBase. Circle was founded by Jeremy Allaire and Sean Neville who also helped launch USDC. Jeremy currently sits as the CEO of Circle while Sean has since left Circle, but remains board member of CENTRE. The CENTRE Consortium stands as a legal entity which provides governance and standards for the project and the asset.

3. Please indicate the ICO date, initial price and valuation of the token and total capital raised (in USD and crypto terms).

  • USDC-SPL ICO Date: OCT 2020
  • Initial Price & Valuation: $1
  • Not reported for USDC-SPL ($110M USD raised for USDC-ERC20 Launch OCT 2018)

4. How much of the capital raised via the ICO was converted into FIAT (in terms of FIAT currency and amount of tokens)?
N/A

5. What was the way of issuing and distributing the tokens? Were there pre-ICO investors?
USDC relies on a proof-of-reserve system whereby the system is fully collateralized - the number of USDC in circulation matches the value of the funds held in accounts operated by Centre.

Pre-ICO investors: Bitmain, IDG Capital, Breyer Capital, General Catalyst, Digital Currency Group, Pantera.

6. What is the current token distribution (project team vs. investors vs. public)? Has the token distribution changed over time?
Note: The details provided below represent token distribution across all blockchains supported by CENTRE. Exclusively on Solana there are 7.3% of the USDC tokens issued to date, reaching a total of $3,798,926,727. Current distribution across all networks can be found here.

  • Investors: total of 77 with 19.97% concentration (9.29b USDC)

  • Whales: total of 15 with 41.94% concentration (19.51b USDC)

  • Holdings Distribution Matrix for USDC ERC-20

  • Distribution change over time

7. Are there any fees generated by the protocol? If yes, please provide details and amounts.

  • Users are able to convert and redeem USDC at a ratio of US$1.00 for 1 USDC with no fees. Users will only be charged in a rejected-tokenization process with a fee of $50.
  • Circle Pay fees: 2.9% + $0.30 per transaction. +1% for cross-border transactions.

8. Is the protocol audited? By what firms? Please provide link(s) to the audit documentation.
Yes, the protocol passes regular audits, including:

9. Other relevant project data or comments:
Legal structure of the protocol encompasses:
Circle LLC Internet Financial Limited Company
CENTRE. Member-based Consortium
CoinBase Inc

Asset Profile

1. Asset name:
USDC-SPL (USD Coin)

2. Asset type (native/ wrapped):
Native

3. One-sentence description of the asset:
USDC is a fiat-collateralized stable coin that offers the advantages of trading blockchain-based assets while mitigating price risk and preventing high volatility.

4. What’s the purpose of the asset within its native ecosystem?
The USDC-SPL asset serves as a one-to-one representation of fiat deposited as collateral. USDC-SPL is minted by users to allow them access to the advantages of trading blockchain assets, while mitigating price risk and high volatility typically associated with crypto-assets. Born as an alternative to fiat money, USDC gives users access both to transacting within the DeFi world, as well as to using the service offered by circle.io, converting their collateralized digital dollars into fiat money at their local banks.

In addition, Circle provides the financing system Circle Yield, as an incentive for the promotion of USDC and as a reserve of value (subject to passing a KYC under the Bermuda Monetary Authority and with a requirement of a minimum deposit of $100,000).

5. Does the asset have any use outside of its native ecosystem (integrated protocols)?
USDC-SPL is supported by the CENTRE Consortium multi-chain initiative, providing integrations to Ethereum, Algorand, Solana, Stellar, Tron, Hedera, Avalanche, Celo, and Flow, with plans to expand to Polkadot, Kava, Nervos, and Stacks.

Wallets that support the token are: TrustWallet, Ledger, Coinbase Wallet, Crypto.com, Phantom Wallet and Slope Wallet.

Web3 platforms with USDC presence: Serum, Raydium, CoinBase Commerce, Ascendex, Mango Markets, Star Atlas, Magic Eden and Jet Protocol.
The following graph from Santiment shows the progress of the circulation of USDC in the entire DeFi ecosystem the past two years:

6. Smart Contract address:
EPjFWdd5AufqSSqeM2qN1xzybapC8G4wEGGkZwyTDt1v

Asset Liquidity

1. What exchange(s) support the asset?
Serum, Orca, Raydium, and Atrix

2. Does the asset have liquidity on Serum? What is the liquidity depth (resting orders)?
Yes, USDC has liquidity on Serum. Snapshots of the resting liquidity on Serum at this point in time are not included, because the dramatic trading volumes today mean such plots would be unrepresentative.

3. Please provide 7-day asset trading history (daily aggregated trading volumes for trading pair of asset with USDC).
Up to date volumes of top 10 trading pairs for USDC on Serum can be taken from to Vybe Network’s data feed. The other supported collateral types are BTC, ETH, and SOL. The 7-day volume in these pairs ranges from $45mn to $770mn.

4. Which oracles monitor the asset? How many feeds are available?
Pyth - Markets | Pyth Network

5. How often does the asset drop significantly in price?
USDC peg mechanism uses a simple 100% collateralization approach. This means that for every 1 USDC token in circulation there is USD $1 held in collateral. Price has remained stable to date under this mechanic.

6. For stable coins only: Has the asset ever lost the peg? If yes, for what reason?
USDC never lost the peg.

7. For wrapped assets only: Which bridges are used? Are they custodial or non-custodial? Are they audited?
n/a

8. What amount of asset’s liquidity exists in the integrated protocols (if applicable)?
The tables below show the volume traded within the SOL/USDC pair on different Solana Protocols during 28/03/2022:

9. List any parties interested in taking part in liquidations for the proposed asset type.
All DeFi users due to USDC’s liquidty on most platforms, and popular blockchains.

Key Mechanics

1. How many active addresses/ users currently hold the asset?
USDC-SPL:

USDC addresses across all chains:

2. Is the asset supply expected to increase or decrease over time? Is there a token burn mechanism? Is the project able to mint more tokens in the future?
The anticipated supply of USDC will follow the demand for fiat in DeFi, which is expected to increase over time. Both burn and mint mechanisms are in place for USDC:

  • The burn mechanism allows users to trade their USDC-SPL for fiat.
  • The mint mechanism allows users to deposit their fiat as collateral to mint USDC-SPL.
    The investors of USDC-SPL and the project itself cannot mint, nor has access to non-fiat backed USDC-SPL.

3. Please explain the staking mechanism (if any).
N/a

4. Please explain the slashing mechanism (if any).
N/a

5. Are there tokens on vesting schedule? If yes, what is that schedule and related vesture limitations?
No, tokens are not on a vesting schedule.

6. Are any tokens allocated for specific purposes or issuance schedules (e.g. liquidity mining)?
No, there are no project-backed token allocations for specific purposes. Other DeFi ecosystems may utilize USDC for specific purposes or issuance schedules, however the asset’s native project does not use the token in this way.

Legal Profile

1. Is the project or the asset owned by any incorporated organization?
a. Y / N - Yes
b. Organization Name: CENTRE Consortium
c. Jurisdiction: US

2. In which jurisdictions was the token issued?
Boston Municipal Court

3. Was the token issued as part of regulatory process (e.g. securities offering)?
No

4. Was the token issued as part of fundraising process?
No

5. Has the project or the asset obtained any legal opinions on the regulatory standing of the token? If yes, please provide links to the relevant documentation.
USDC is regulated as a stored value instrument (similar to a pre-paid card). Store of value products are regulated under state money transmission laws. CENTRE is subject to oversight by 46 state regulators.

6. Has the project or the asset had any legal interactions? If so, describe and provide documentation.
Circle freezes $100k in USDC at Law Enforcement’s Request

Links

Relevant Solana Addresses:

List all relevant Solana addresses here

  • EPjFWdd5AufqSSqeM2qN1xzybapC8G4wEGGkZwyTDt1v
  • 3emsAVdmGKERbHjmGfQ6oZ1e35dkf5iYcS6U4CPKFVaa
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